Bayer to sell diagnostics division to Siemens

GabrielMadway

SAN FRANCISCO (MarketWatch) -- Bayer AG
BAY, +9.09%BAYN, +0.26%
said Thursday it plans to sell the diagnostics division of Bayer HealthCare to Siemens AG
SI, +5.36%
for 4.2 billion euros ($5.32 billion). The sale was approved today by the Bayer supervisory board. Bayer said it would see after-tax proceeds of 3.6 billion euros from the sale. The diagnostics division had sales of 1.4 billion euros in 2005. Bayer said the sale will affect its acquisition of Schering
SHR, -1.94%
in that the planned 1.3 billion-euro hybrid bond may not be launched or may have a much smaller volume. In addition, the company said its plan to raise up to 4 billion euros in equity in connection with the Schering deal is now likely to be reduced by 500 million euros. "The effect of this divestment is to substantially reduce our debt, thus helping to improve our credit profile," said Bayer management board Chairman Werner Wenning in a statement.

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